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ABSTRACT
Hitherto, to many, the concept of oil and gas was limited to the search for, work and win
crude oil. So, for many decades, nations only concerned themselves with upstream petroleum
activities. The availability of crude oil determines the extent of relevance a nation
commanded at the global scene. This fact is amplified by the role Nigeria played in the
struggle to rid Africa of colonial vestiges. The marketing of petroleum products (downstream
sector activities) is therefore brought to the fore of the national petroleum industry. The
issues of oil and gas in Nigeria are very topical and sensitive. The products of oil and gas are
present in every home in Nigeria. Arising from this, the government became very much
involved in the supply and distribution of its product. Various laws, including the Petroleum
Equalization Fund (Act) Instituted as a result of the problems associated with the petroleum
distribution, were put in place to govern the petroleum industry. However, there appear to be
inconsistencies between these laws and what actually obtains. This research principally
adopted a doctrinal research methodology which relied on existing statutes, subsidiary
legislation and literature on petroleum products marketing. It analyzed the issues and drew
inferences which culminated in the findings. This dissertation found that the legal framework
for the regulation of the downstream sector of the petroleum industry is not robust and
comprehensive; that there is conflict of functions between the Petroleum Minister and the
Petroleum Products Pricing and Regulatory Agency. This is with respect to the fixing of the
prices petroleum products. This conflicting function does not make for improvement of
effective pricing of petroleum products as it does not allow market forces to determine the
price; that the functions of government regulatory agencies such as the Nigerian National
Petroleum Corporation (NNPC), the Department of Petroleum Resources (DPR), the
Petroleum Products Marketing Company (PPMC) and the Petroleum Products Pricing and
Regulatory Agency (PPPRA) are overlapping and therefore work at cross purposes; that the
Petroleum Equalization Fund put in place for the sole purpose of unifying the pump prices of
petroleum products across the country is ineffective, fraught with corruption and has resulted
in waste of financial resources; and that government involvement in downstream activities
makes law enforcement weak and ineffective. This research therefore recommended a
restructuring and reforming of the legal framework and regulatory bodies for the Nigerian
Petroleum Industry through the passage of the Petroleum Industry Bill (PIB); existing laws
should be reviewed for effective regulation with the roles of government agencies clearly
defined; that the Petroleum Equalization Fund be repealed; and that government should exit
participating in the downstream sector (through the Nigerian National Petroleum
Corporation) and only be a regulator.
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